Wall Street sank as Fed may rise rates earlier than expected

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economy and dollar, stock market

Wall Street stocks ended lower on Wednesday after the Federal Reserve meeting.

As expected, the Fed left interest rates unchanged despite the spike in inflation and improved its forecast for the country’s economic growth to 7% in 2021.

However, the central bank has advanced the dates for the next rate hike. It is projected to boost interest rates by the end of 2023, earlier than anticipated, which surprised the market.

The Fed also raised its estimates for the inflation rate in 2021 from 2.4% in March to 3.4%.

On the other hand, Jerome Powell, the Fed Chairman, said that there had been a discussion when it would be appropriate to start talking about a possible reduction in stimulus. It is something that worries investors.

At the end of the New York Stock Exchange Session, the Dow Jones dropped by 0.77% at 34,033.67 as eyes were fixed on the Fed. Meanwhile, the S&P 500 yielded 0.54% at 4,223.70. The Nasdaq Composite decreased by 0.24% at 14,039.68. 

Most of the Southeast Asian stocks closed with a loss

Most of the Southeast Asian stock markets ended the day with losses on Thursday. Only the Ho Chi Minh market ended with rises. 

The Fed announcement has unleashed fears of an accelerated withdrawal of stimulus in the United States.

In Singapore, the city-state stock market decreased by 1.26 points or 0.04%. The Straits Times composite indicator remained at 3,138.31 units. 

The Jakarta stock dropped by 0.17%, or 10.12, and the JCI index ended with 6,068.45 units.

The Kuala Lumpur Stock Exchange lost 0.47% or 7.46 points, and the selective KLCI ended at 1,570.86 units.

The Bangkok stock yielded 0.44% or 7.14 points to settle at 1,617.65 units.

The Manila Stock Exchange decreased by 85.43 points or 1.23%, and the PSEi composite index ended at 6,887.92 points.

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